Which of the following is counted in GDP?
a. the cost of the reconstruction and cleanup following September 11, 2001.
b. the value of leisure time
c. the value of a househusband's work at home
d. the value of your do-it-yourself work
a
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Answer the following statement(s) true (T) or false (F)
1. In the absence of transactions costs, changes in property rights have no effect on economic efficiency. 2. In the absence of transactions costs, changes in property rights have no effect on the distribution of income. 3. Changes in property rights will not affect the allocation of resources as long as transactions costs are zero and the subsequent effects on market demand are negligible. 4. The weak Coase theorem is true when reallocation of property rights have negligible income effects . 5. According to the Coase Theorem, in the absence of transactions costs, recipients of an external benefit can be expected to offer a bribe in exchange for greater production.
A profit-maximizing firm in a competitive market will always make marginal adjustments to production as long as
a. average revenue is greater than average total cost. b. average revenue is equal to marginal cost. c. marginal cost is greater than average total cost. d. price is above or below marginal cost.
Related to the Economics in Practice on p. 79: If the supply of generators decreased and the equilibrium price of generators decreases, the demand for generators ________ and total revenue from the sale of generators ________.
A. may have increased, decreased, or stayed the same; will decrease B. may have increased; decreased, or stayed the same; may increase, decrease, or stay the same C. decreased; will decrease D. increased; may increase, decrease, or stay the same
Relative to a profit-maximizing competitively organized industry that is producing 3,000 units of output at a price of $5 per unit, a monopoly under the same circumstances would produce ________ units of output and charge a price of ________ per unit.
A. less than 3,000; more than $5 B. less than 3,000; less than $5 C. 3,000; $5 D. more than 3,000; more than $5